News Corporation (NWS)

Deutsche Bank has maintained its “buy" recommendation on
News Corporation
and left its estimates broadly unchanged after BSkyB released its financial year 2012 results.

The broker says its estimates for BSkyB are mostly unchanged at the earnings before interest, tax and amortisation level but the proposed £500 million buyback brings 2-3 per cent earnings per share upgrades.

“The company continues to grind out impressive RGU [revenue generating unit] growth, delivering 3 per cent ARPU [average revenue per user] and revenue growth, even without the price rise. This drove earnings per share growth of 19 per cent in the fourth quarter and 22 per cent 2012 financial year. Particularly notable was the 81 per cent UK broadband market share demonstrating the traction Sky gets with its TV base."

Deutsche Bank is forecasting earnings per share growth for News Corp of 17 per cent for the 2012 financial year and 25 per cent for 2013, to $US1.38 and $US1.73 respectively.